Union talks up offshoring dangers to UK economy

The Public and Commercial Services Union is warning that a wave of private sector jobs will inevitably move offshore as the government forces IT suppliers to cut costs.

At the start of this week, PCS members working at HP voted in favour of industrial action over plans to axe 200 staff in the north-east working on the Adams 2 contract for the Department of Work and Pensions and outsource their functions to India.

"We think this is a sign of things to come," national press officer Richard Simcox told The Reg. "The government is caught between its desire to cut spending and force contractors to cut costs."

In a ballot of HP staff, more than 90 per cent of the turnout (47.2 per cent) voted for industrial action short of a strike, with the aim to disrupt the knowledge transfer set to take place this month when staff from India liaise with their UK counterparts.

PCS said at this stage the government and HP were not showing signs of wanting to resolve the issue but hopes the action will "focus the minds".

North-east MPs last month weighed into the scuffle to add pressure on the government to safeguard the HP workers, pointing out the obvious impact of job cuts on the local economy but also the potential data security implications.

There are 25 million records on the DWP national database including details on benefit payments that would be handled by the staff in India. Both the Cabinet Office and DWP have to ratify the deal before it goes ahead.

In a written response to questions raised in the House of Commons by Tyneside Northeast MP Mary Glindon, PM David Cameron last month agreed that "British employers should employ British workers".

But he said DWP IT services were under contract by a number of suppliers of which HP was one and that the agreement allowed for the provision of some services from outside the UK.

"We are looking closely at the DWP's approach to the offshoring work by its suppliers with the aim of minimising any impact on the UK jobs market," said Cameron.

Simcox, of the PCS, said the government giving IT corporations the green light to outsource UK jobs abroad, "blows a hole in their argument that the private sector will step up and provide the jobs being cut in the public sector".

An HP spokesperson said: "We have begun consultation on the proposed transfer of some roles to our operations in India effective in 2012, subject to final client approval. This relates to work at a small number of sites in the UK. We are working to redeploy staff affected into other roles within HP and are optimistic that we can avoid compulsory redundancies." ®